In the short run, market anticipation of exciting 4Q21 earnings may trigger a further stock price rally. Over the longer view, there could be upside to our 2022 forecast if SPALI were to execute planned asset spin-offs totaling Bt3.2bn to SPALIRT. The stock trades at a 2022 PER of 7.5x, below our ResProp coverage mean of 10.6x. Our YE22 target price is Bt25 (pegged to a PER of 8.5x). BUY!
Beat us and the street
SPALI reported a 3Q21 profit of Bt1.72bn, up 41% YoY but down 1% QoQ. The result was 12% above our estimate (and 10% ahead of the consensus), due to a 50bps fatter GM and an 80bps lower SG&A/sales ratio than assumed.